EC moots telecom super-regulator

Significant support, but most against

By Matthew Broersma | 03 September 06

The creation of a pan-European telecoms regulator has found significant industry support for the idea, though most remain against the notion overall.

As part of an ongoing review of telecoms regulations, the EC (European Commission) looked into whether an EU (European Union)-wide regulatory body should be put into place to deal with particularly powerful organisations, mainly incumbent operators such as BT.

The study, Preparing the Next Steps in Regulation of Electronic Communications, was conducted by Brussels law firm Hogan & Hartson and London-based Analysys. "Several respondents suggested that an enhanced community control over remedies would facilitate greater harmonisation and availability of consistent wholesale products across the EU," the EC said in a statement.

The majority of respondents said improvements of one form or another were needed in either the regulations or their implementation. But the problems they pointed out were varied, including the weakness of national regulators, unharmonised implementation, lack of pan-European services in general and uneven application of existing regulations.

"The only consistent message from these responses is that implementation needs to be completed, and in some cases improved, a finding that we see repeated frequently," the study said.

With regard to the establishment of an ERA (European regulatory authority), more respondents were opposed to than supported the idea, the report concluded. A number of organisations, particularly alternative operators, said an ERA would be better at applying regulation to large, powerful businesses because it wouldn't have any vested interest in the national status quo.

"One argument presented in support of an ERA is that it may be able to apply regulation in a more consistent manner and stand up to incumbents when the current NRA [national regulatory authority] may not," the report said. "Some respondents alleged that their NRA was either lax or ineffective in imposing regulation."

That same lack of connection to the local market also weighed against the idea of a European body for many, who said it wouldn't be able to make regulatory decisions in a consistent and well-informed way.

From the British point of view, a European regulator would make no sense, according to RedMonk analyst James Governor. "It sounds like bad news, mainly because after years of appalling and unsuccessful regulation in this country, the telecoms sector has finally got its act together," he said. "There is a lot of competition. I can't see outside regulation being helpful at this point."

The EC released another study that found regulation was essential to continue attracting investment to the telecoms sector. A third study found that regulation at the wholesale level was enough to keep the sector in line, and that retail regulation could be largely scrapped.